According to the Metal Industry Indicators report released by the US Geological Survey (USGS), the primary metal leading index for the US decreased by 1.8 percent in September this year, the latest month for which it is available, to 156.9 from a revised 159.8 in August. Its six-month smoothed growth rate decreased to 1.8 percent in September, from a revised 6.8 percent in August.
According to the USGS report, the decreasing growth rate in the primary metals leading index suggests that growth in US metals industry activity could slow further. Growth in the manufacturing sector, particularly for motor vehicle production, could possibly weaken, while in the construction sector of the economy, the only thriving domestic projects are apartment building, as demand for rental apartments is rising. The slow US economic recovery is not likely to spur significant US metals activity growth.
Meanwhile, the steel leading index for the US increased 0.4 percent in August, the latest month for which it is available, to 113.1 from a revised 112.6 in July. Its six-month smoothed growth rate decreased to 3.2 percent in August, from a revised 3.4 percent in July. The steel leading index growth rate remains above the threshold that indicates growth in the US steel industry; however, it has been trending down since the start of the year, suggesting that the recovery in the steel industry could falter in the near term.
Note: Composite coincident indexes for the metal industries consist of indicators for production, shipments, and total employee hours worked. A growth rate above +1.0 percent is usually a sign of an upward near-term trend for future metals activity, while a growth rate below -1.0 percent indicates a downward trend.